Chris Kempczinski, CEO of McDonald’s, has pointed to a global boycott led by Muslims and supporters of Palestine as the primary reason behind the fast-food giant’s declining quarterly sales. This marks the first decline in global sales for McDonald’s since 2020.
The boycott, initiated by Palestinian supporters worldwide, has gained significant momentum since the onset of the ongoing siege of Gaza by Israel, which began in October of last year. This collective action has significantly impacted consumer sentiment, particularly in regions with strong support for Palestine.
During a recent earnings call, Kempczinski acknowledged the boycott’s impact, noting that McDonald’s revenues for the quarter stood at $6.49 billion, a figure that remained largely unchanged from the previous year. However, the company’s net profit saw a 12% decline, falling to $2.02 billion, and international sales dropped by over 1%. This decline is noteworthy given McDonald’s extensive presence in more than 100 countries with over 40,000 restaurants.
Kempczinski attributed part of the revenue decline to consumers becoming “more discriminating with their spend,” likely influenced by the boycott campaign. The boycott against McDonald’s and other American companies began in October 2023 after McDonald’s outlets in the Israeli-occupied Palestinian territories announced the donation of thousands of free meals to Israeli soldiers. This action sparked widespread backlash, particularly in Muslim-majority countries and among supporters of the Palestinian cause.
The boycott is part of the broader Boycott, Divestment, and Sanctions (BDS) movement, which aims to pressure Israel into complying with international law and respecting Palestinian rights. The BDS campaign has targeted other American brands such as Starbucks, Burger King, KFC, Pizza Hut, and Papa John’s. Additionally, companies like Coca-Cola, Pepsi, Wix, Puma, and Zara, known for their financial ties to Israel, have faced similar boycott calls.
The BDS movement has garnered global support, with thousands of volunteers advocating for economic, cultural, and academic boycotts of Israel. Pro-Israel groups have described BDS as an “existential threat” due to its potential economic impact.
The situation in Gaza remains dire, with reports indicating that the ongoing conflict has resulted in the deaths of 39,363 Palestinians and injuries to at least 90,923. The international community continues to call for a resolution to the crisis, emphasizing the urgent need for humanitarian aid and peace negotiations.
In light of these developments, McDonald’s faces a challenging landscape, as the global boycott significantly influences its sales and consumer behavior. The company will need to navigate this complex scenario while addressing the concerns of its diverse consumer base and stakeholders.
